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429 Walnut
Rochester, Michigan 48063

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mistakes get a
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& look your very best

U.S. Economic Grants
To Israel Are Frozen

WOLF BLITZER

Special to the Jewish News

T

he entire $1.2 billion
in U.S. economic assis-
tance which was pro-
vided to Israel in October has
since been frozen in a sepa-
rate Israeli bank account
because of recently-enacted
U.S. restrictions on its use,
U.S. and Israeli officials
disclosed last week.
Israeli Finance Ministry of-
ficials, during extensive but
unpublicized discussions with
Reagan Administration of-
ficials and congressioinal
leaders, have been trying to
win an exemption for Israel
from the restrictions, which
were actually approved a year
earlier by Congress and
signed into law by President
Ronald Reagan in late Oc-
tober 1986.
The restrictions affect all
countries — not just Israel —
receiving what are called U.S.
Economic Support Funds
(ESF), or grant economic
assistance. The legislation,
originally sponsored by
members of the House and
Senate appropriations com-
mittees, was passed in order
to give the United States
greater accountability in
making sure that those funds
are used properly and legally.
The money is supposed to
be spent solely for imported
U.S. commercial goods and
services — and not for mili-
tary purposes. However, some
U.S. lawmakers had been con-
cerned about the way these
funds were being used in the
Philippines, Haiti and
elsewhere.
Israel, U.S. legislators
agree, was not the target of
the new restrictions. They in-
sist that there was never any
question about whether
Israel was using its funds pro-
perly. They note that Israel
continues to import con-
siderably more commercial
goods and services from the
U.S. than it exports.
Because Israel had received
its entire 1987 fiscal year $1.2
billion economic allocation
early in October of 1986 —
before the new legislation was
passed — it was not restricted
by the law last year, as were
other countries receiving the
ESF cash transfers, including
Egypt, Portugal and Turkey.
Now, however, Israel, like
the other ESF recipients, is
required to keep a separate
account for and a running
track on the exact use of the
entire $1.2 billion, which
Israeli Finance Ministry and

Bank of Israel officials view
as a bureaucratic nightmare.
Israeli officials are still hop-
ing that Congress will ap-
prove legislation in the com-
ing months exempting Israel
from the auditing restric-
tions. But barring that, they
hope that the Administration
will at least adopt inter-
pretative rules making the
restrictions less bureaucratic-
ally onerous for Israel.
In the meantime, the $1.2
billion remains temporarily
frozen. The separate $1.8
billion in military grants ap-
propriated for Israel as part of
the 1988 fiscal year foreign
aid bill are not affected by the
restrictions. Those funds, for
the most part, pay for mili-
tary purchases in the U.S.
Some of the money, however,
can be used for the purchase
of Israeli-made defense
equipment.

JDL Office

To Remain Open

Washington (JTA) — Rep.
Nick Rahall II (D WV.) asked
Secretary of State George
Shultz to consider closing the
offices of the Jewish Defense
League (JDL), but Shultz re-
jected the idea, an aide to
Rahall said last week.
Rahall's request followed
the State Department's deci-
sion to close the Palestine
Liberation Organization's
Washington office on the
basis that it is a terrorist
organization.
Jerry Burkot, Rahall's
press secretary, said that in a
letter to Shultz, Rahall noted
JDL terrorist activity, saying
three JDL members pleaded
guilty Aug. 13 to terrorist
bombings and were later
sentenced.
The three are Victor Van-
cier, Jay Cohen and Murray
Young. Vancier said he had
been the JDL's national chair-
man until November 1986,
while Cohen and Young were
JDL board members.
They admitted responsibili-
ty for at least five other bomb-
ings over the last three years
and a scam to divert to JDL
money raised ostensibly on
behalf of New York Gov.
Mario Cuomo.
Shultz's response stated
that the State Department
was powerless to close the
JDL offices because, unlike
the PLO, JDL is not a foreign
mission that can be closed
under the Foreign Missions
Act.

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THE DETROIT JEWISH NEWS

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